Superannuation Reforms – are you 30 June 2017 ready?
Your Superannuation & the Reforms – what it could mean for you
The superannuation reforms announced in the 2016-2017 Federal budget have passed Parliament and will come into effect from 1 July 2017. Previous changes that the Howard government introduced in 2007 which allowed contributions up to $1million were significant. There have been changes since then but these are the biggest changes seen in a decade.
The reforms have a huge impact on the ability to contribute funds to superannuation. The superannuation environment is the most tax friendly environment and these changes will now limit the amounts you can contribute. It is time to consider the impact these changes may have on you and consider any action you may need to take before 30 June 2017. It is imperative right now to make sure you are making full use of what you can within the current rules. Our team are ready to discuss your situation & help you make informed decisions now and to plan for your future.
With the reform that will reduce the tax-free limit in pension phase to $1.6 million, it is important to maximise the exempt current income amount. This must be looked at on an individual or SMSF member basis to work out the balance of pension and/or accumulation amounts. There is no ‘one size fits all’ approach.
In moving from the current rules to the new rules there are various choices and options to be looked at regarding CGT cost bases and the outcomes that could have a significant impact for the future. Any changes to your current situation need to be finalised before 30 June 2017.
If you are under 65 and making non-concessional contributions to superannuation, the reforms reduce the cap and change the ‘bring forward’ rule which will limit the amount you can contribute in any one year. Taking advantage of the bring forward rule now will utilise the current caps and allow you to maximise these contributions before the changes come into effect.
There may also be some steps to consider for succession planning in self-managed super funds as the current estate instructions in place may not be relevant to you & your partner after 30 June 2017.
You can’t just sit back and wait – 30 June 2017 superannuation reforms could have a lasting impact on your future. Some plans will need to be made and finalised in the 2017 financial year and some will be ongoing. Make the most of the next 3 months.
How can we help?
Our accounting specialists are ready to assess your situation and provide the various strategies to our wealth advisors who will deliver the advice and implementation plan to you so are 30 June 2017 ready.